He dismissed as "no solution" the Oakeshott bill because the government had said it would not transfer women and children to Malaysia.

People smugglers would simply load up their boats with women and children to get around the law.

"Compromise per se has never been a substitute for good policy," Senator Abetz said, adding the ability to turn back boats if it was safe should be in the government's armory.

The coalition wants offshore processing limited to the 148 countries that are signatories to the UN refugee convention.

That would rule out Malaysia, but allow Nauru and Papua New Guinea.

Australian Prime Minister Julia Gillard earlier appealed to senators to look into their consciences over the laws.

''There's a very stark choice for senators today,'' she said this morning.

''Either they vote for this bill and we will leave this parliament with laws so we can process people offshore or they continue to play politics and we end this parliament with nothing effective done.''

Home Affairs Minister Jason Clare warned there was a ''real risk'' more people would die if the Senate failed to pass the bill.

FALSE ALARM

Reports of a distress call this morning from a boat carrying asylum seekers en route to Australia were a false alarm.

Martime officials in Australia say the boat was apparently a fishing vessel.

The Australian Maritime Safety Authority said the vessel in trouble 20 nautical miles off Indonesia did not appear to be carrying asylum seekers.

Authorities are edgy after a vessel carrying about 130 people sank north of Christmas Island with four lives lost yesterday, sparking intense scenes in Parliament.

And last week dozens of people were killed when anotherboat capzised in the area. More than a hundred other people were pulled alive from the sea.

Australia is a common destination for boats carrying asylum seekers from Afghanistan, Iraq, Sri Lanka and other poor or war-torn countries.

In December 2010, an estimated 48 people died when an asylum seeker boat broke up against Christmas Island's rocky coast.

Last December, about 200 asylum seekers were feared drowned after their overcrowded ship bound for Australia sank off Java.

Other boats are suspected to have sunk unnoticed with the loss of all lives.